THE VERMONT

October 8, 1942;

THE VERMONT; GLIDDEN CO.
v.
THE VERMONT et al.

The opinion of the court was delivered by: CAMPBELL

CAMPBELL, District Judge.

This suit was brought by the libellant, the owner of a cargo of cocoanut oil, which was, at the port of Portland Oregon, loaded on board the Steamship "Vermont", owned by the claimant-respondent, California Eastern Line, Inc., to recover damages alleged to have been caused to said cargo by the contamination by mineral oil while in the port and starboard deep tanks in hold No. 3 of the said S.S. "Vermont".

Claimant-respondent denies the damages claimed, and alleges in the alternative that if there was any damage neither it nor the S.S. "Vermont" is responsible under the provisions of the contract of carriage, and of the Carriage of Goods by Sea Act of 1936, 46 U.S.C.A. § 1300 et seq.

The S.S. "Vermont" was a common carrier, being a general ship engaged in the common carriage of libellant's shipment of oil. The Point Brava, D.C., 1 F.Supp. 366. She was sailing on a line engaged in the intercoastal trade, and the voyage in question, described as No. 9, was an intercoastal voyage between the Port of Portland, State of Oregon, and the Port of New York.

The oil was booked pursuant to a letter of March 13th, 1940, which was prepared and sent by claimant-respondents' San Francisco agents to the libellant, at its Food Division, which is carried on under the trade name of Durkee Famous Foods. Called by whatever name it may be, it states the terms under which space was reserved on the "Vermont", on the voyage in question, for a minimum quantity of 700 short tons of cocoanut oil in bulk.

The conditions of transportation as set forth in that letter, are as follows: "Rate of freight and terms as specified in United States Intercoastal Eastbound Freight Tariff No. 2-C, S.B.-I No. 7, Section 5, supplements thereto and reissues thereof, and subject to all terms and conditions of Carrier's Bill of Lading."

The terms of these rules, which have been certified by the Interstate Commerce Commission under the Transportation Act 1940, Title 49, Sections 901-923, U.S.C.A. contain the following provisions:

Rule O-3. Liability. Carriage of oil in bulk is at the owner's risk of loss, contamination, discoloration, leakage, seepage, or any damage the oil may suffer through being carried in bulk or any damage from steam coils and/or their connections.

Rule O-4. Tanks, Cleaning and Inspection. The carrier is to clean and prepare tanks prior to vessel's loading and to install heating coils when necessary. If the shipper's surveyor rejects tanks as not fit for the carriage of oil to be carried, carrier shall have the option of doing whatever further cleaning and preparing is called for by shipper's surveyor or cancelling the booking and sailing the ship without liability or penalty. Acceptance of tanks by shipper's surveyor shall be deemed prima facie evidence of their fitness for the carriage of the oil. The expense for cleaning the ship's tanks is to be borne by the carrier and inspection thereof is for the account of and at the expense of the shipper.

Rule O-5. Loading and Discharging. Carrier will not make more than one shift to safe berth at loading port and not more than one shift to safe berth at discharging port, and if consignee fails to have facilities available when vessel is ready to discharge, carrier may employ barges, lighters or other equipment and proceed with the discharge of the oil thereto, all expense for such equipment as well as for the discharge of the oil being for the account of the cargo owner, or consignee thereof. (Seee Exceptions 1 and 2.)

Rule O-6. Pumping Oil. All appliances and labor necessary for pumping the oil in and out of vessel to be provided by owners and/or consignees of the oil at their expense; carrier to furnish steam for heating as well as power for pumps to enable adequate discharge of the oil.

Said shipment of bulk cocoanut oil was transported subject to the terms of a bill of lading, in which was incorporated the provisions of the Carriage of Goods by Sea Act approved April 16, 1936, Title 46, U.S.C.A., Sections 1301-1315.

By Title 46, U.S.C.A., Section 1300, the Carriage of Goods by Sea Act is made applicable to every bill of lading or contract for the carriage of goods by sea to or from ports of the United States, in foreign trade, not in intercoastal trade, but the parties had the right to incorporate the provisions of the Carriage of Goods by Sea Act in the bill of lading, Section 1312 of that Act.

By Section 1303 of that Act subdivision 1, the carrier is bound, before and at the beginning of the voyage to exercise due diligence to -- make the ship seaworthy, to properly man, equip and supply the ship, and to make the holds, refrigerating and cooling chambers, and all other parts of the ship in which goods are carried, fit and safe for their reception, carriage and preservation.

By Section 1305 of that Act it was provided that a carrier shall be at liberty to surrender in whole or in part all or any of his rights and immunities or to increase any of his responsibilities and liabilities under the Act.

That Act, however, does not give the carrier the right to relieve itself from any of its responsibilities and liabilities. The Steel Inventor, D.C., 35 F.Supp. 986.

Libellant contends that the rules, supra, are without effect here, as they release the carrier of some of its responsibilities under the Carriage of Goods by Sea Act contrary to the terms of that Act, but that contention is not generally sustained.

The obligation of the carrier under Section 1304 of that Act is to use due diligence, and the burden rests upon the carrier to show the exercise of due diligence, and so far as Rule O-3 is concerned, it does not relieve the carrier from using due diligence to make the vessel seaworthy, with clean thanks for the cargo, nor is intended so to do as by Rule O-4 the cleaning of the tanks is specifically provided for, and furthermore, if construed so to relieve, it would be void under the Carriage of Goods by Sea Act, supra.

The provisions of Rule O-4 making the cleaning of the tanks as called for by the surveyors for the shipper and their acceptance prima facie evidence of their cleanness, did not relieve the carrier from any obligation, but simply created a rule of evidence, and in no way conflicted with the Carriage of Goods by Sea Act, supra, and are binding in the instant suit.

The provisions of Rules O-5 and O-6 supra, requiring the shipper or consignee to load and to discharge the bulk oil cargo, and be responsible for it, and for the equipment furnished by it, and its cleanness, and availability for the purpose, did not relieve the carrier from any obligation imposed on it by the Carriage, of Goods by Sea Act, and said rules are binding.

On behalf of the libellant, it is contended that not only must the carrier, in order to be relieved, show due diligence to make the vessel seaworthy and the deep tanks clean, but, must also show the cause of the damage, and cites the following cases as authority for its contention. The Arakan, D.C., 11 F.2d 791, 793; Newhall et al. v. United States et al., D.C., 8 F.2d 422, 423; The Rosalia, 2 Cir., 264 F. 285, 288; The S.S. Asturias, D.C., 40 F.Supp. 168, 173, affirmed Wessels v. The Asturias, 2 Cir., 126 F.2d 999, 1942 A.M.C. 360.

All of these cases, with the exception of The S.S. Asturias, were decided before the Carriage of Goods by Sea Act became effective, and required the loss to be brought within certain specific exceptions.

That has been changed by the Carriage of Goods by Sea Act supra, § 4(2) (q) pleaded in claimant-respondent's answer, as under that Act the carrier does not have to show the cause of the damage, but has the alternative burden of showing freedom from negligence. Owners of Cargo ...

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